Will the duties be excessive this year? I always just download. Seems unfair amount of extra payment for just downloading.

I don't think PG Music has any control over that. I'd direct the query to Parliament.

For those of us who don’t know how this works, could you explain a bit? I thought that only physical items were taxed based on their value. We’ve had many discussions about what form of delivery could lessen the VAT. I thought downloading was not taxed.

It used to be like that in Australia, Matt. These days, though, the government expects the same 10% goods and services tax to be paid on overseas purchases as we would if we bought locally. It now applies everywhere.

Last year the extra was included but one of the ladies in the team kindly waved it for me. You guys must know that we in UK are suffering a dreadful Tory Government at present along with the crazy antics of the crazed Putin. I guess that goes for you guys too in USA and Canada.

I always make sure I get everything every year but this year may prove otherwise.

Mal

I think those answers mean that my understanding was wrong, and if you buy a PG Music product that is downloaded, you still pay a large tax. Is that correct?

It’s a serious question because we have had discussions about software delivery on flash drives or by different types of compressed files (for the audiophile version that is 2 TB).
The whole point was twofold: avoid surplus USB drives year after year, and minimize the VAT.

Guess we'll know shortly Matt. Downloads should be VAT free, hopefully.

Mal

I certainly hope the price is affordable, but I understand that the tax is legislated and not necessarily something that the seller can avoid.

That's correct. The tax is applied on the value of the goods or service supplied. Even if PGM didn't apply it, in principle HM Revenue & Customs can and should. If they do, they may well of course also fine, or could take legal action.

It is, IMHO, a rather nasty iniquitous tax, because it gets applied at every transfer of transfer of value ... VAT registered businesses can claim it back when they buy and pretty much have to to remain competitive, so every transaction requires the business to be a tax refund claimant on a purchase and a tax collector on a sale.

On a plus side for us in the UK, though, many people don't have to file a personal tax return for their earnings.

We will get 20% VAT added and the dollar/pound exchange rate is awful so in real terms the upgrade will be more expensive this year

I think I understand your concerns now.

Actually, we can't, not unless the seller has a UK VAT number. The US company should, however, allow us to provide them our GB VAT number, in which case it should be sold to us at the ex-VAT price and we enter it as "out of scope". If we sell it on, then we charge the VAT.

It's a pain because a lot of sellers charge the VAT but don't allow us that option. Some sellers just ignore it completely and don't charge any VAT. The whole thing is a complete mess and ridiculously overcomplicated for both the seller and the (business) buyer.

For personal, non-business customers, all US companies are supposed to charge UK VAT for digital products, at the time of payment. For physical products they don't, we pay it our end at customs. At least that's how it was last time I looked.

I didn't know about the non-UK sellers and VAT number stuff. Very messy and means that some imported stuff will be double-taxed at that 20% each time.

I'd hoped that the UK would scrap VAT after we left the EU, along with a large number of other cumbersome EU regulation, but next to nothing has changed. Sigh.

Has anything changed in England as regards say buying a guitar from Thomanns, or are the charges greater since leaving the EU?

I think here in N Ireland its more or less the same price, though not 100% sure.

I don't know how it works with NI since Brexit. Thomann have always charged the VAT for UK customers. I used to spend a hell of a lot of money with them (business customer) but when we first left EU I stopped buying because it was madness - I had no option but to pay the VAT twice.

The good thing now is Thomann got on top of it all quite quickly. What they have done is great, they deal with everything from VAT to Duty to Shipping and include it all in the UK price, so that you can continue buying from them just like it was before Brexit. If you're VAT registered you can also claim back the VAT now because they have set up a UK registered office with a GB Vat number.

Yes it really is a mess. I was very involved with all of this as a UK business. Accountants didn't know the answer, HMRC didn't know the answer - they all had their own ideas and opinions but no clarity or citable facts. It's become so complex that only few specialist "experts" really know - just about every regulation can be contradicted by another. I just learn little by little over time and it's still a complete mess.

https://www.youtube.com/watch?v=l0zaebtU-CA

At one time PG gave us a code for an extra discount to neutralise the VAT. That was for a limited time and I've been paying VAT on extra styles discs so I can't see BIAB 2023 being subsidised.